Almaden Hardware Store sells two product categories, 2018 year-end inventory is

Question

Almaden Hardware Store sells two product categories, 2018 year-end inventory is as follows: tools and paint products, Information pertaining to its of cost or Inventory, by Product Category Per Unit Cost Net Realizable Quantity Tools Hammers Saws Screwdrivers 100 200 300 $5.00 10.00 2.00 $5.50 9.00 2.60 Paint products: 1-gallon cans Paint brushes 500 100 6.00 4.00 5.00 4.50 Required . Determine the carrying value of inventory at year-end, assuming the lower of cost or net realizable value (LCNRV) rule is applied to (a) individual products, (b) product categories, and (c) total inventory 2. Assuming that the company reports an inventory write-down as a line item in the income statement, for each of the LCNRV applications determine the amount of the loss.

Explanation / Answer

ans 1 ans 1a ans 1b ans 1 Qty Per unit cost NRV Total cost Total NRV Individual LCM Product LCM Total inventory LCM Tools Hammers 100 5 5.5 500 550 500 Saws 200 10 9 2000 1800 1800 Screwdrivers 300 2 2.6 600 780 600 Total tools 3100 3130 3100 Paint Product 1 gallon cans 500 6 5 3000 2500 2500 Paint brushes 100 4 4.5 400 450 400 Total oaint 3400 2950 2950 Total 6500 6080 6080 ans 2 a) Amt of loss 700 6500-(500-1800-600-2500-400) b) Product 450 Amt of loss 6500-3100-2950 c) Total inventory 420 Amt of loss 6500-6080

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